Our intentions: Looking at how well the New Zealand Transport Agency manages its contracts to maintain state highways

27 August 2019: In 2017/18, it cost more than $500 million to maintain New Zealand’s state highway network of more than 11,000km of roads. More than 90% of the network is maintained using a model called Network Outcomes Contracts.

The design principles of this contract model, introduced in 2013, were for fewer, bigger, and longer maintenance contracts. In 2014, we noted the risk that the model could reduce competition in the maintenance and renewals market, and that this could have adverse long-term effects on the procurement environment.

What we’re focusing on

Given the significance of the state highway network, and the risk we identified, we are examining how effectively and efficiently the New Zealand Transport Agency (NZTA) uses Network Outcomes Contracts to maintain state highways. To do this, we’re looking at how NZTA is:

managing risks and opportunities to achieve the desired outcomes;
managing the contracts with suppliers; and
identifying, sharing, and applying lessons.

This audit is part of our Procurement work programme.

The difference we expect to make

We expect our work to be useful in:

identifying opportunities for NZTA to better manage Network Outcomes Contracts to maintain state highways;
sharing lessons to influence improved performance of the public sector in procurement; and
informing New Zealanders and Parliament about the performance of NZTA in maintaining our state highways.

The contact person for this audit is the Sector Manager for NZTA, Miranda Biggins.

Please use the feedback form on the right if you’d like to interview Miranda about this audit, make a suggestion, or ask a question.

We expect to complete this work in the first quarter of 2020.